(Yicai Global) July 24 -- Chinese display maker BOE Technology Group will become unprofitable affiliate Electronics Holding Industry Investment's second-largest shareholder to improve its positioning in the Internet of Things.

BOE will purchase a 17 percent stake in the Beijing-based industrial investment platform for CNY100 million (USD14.3 million) to have a total of 33 percent of its equity, the Beijing-headquartered buyer said in a statement yesterday. BOE’s actual controller Electronics Holding is the largest shareholder of the target firm with a 50 percent stake.

EHII will help BOE find merger and acquisition opportunities in upstream and downstream IoT supply chains to boost its core competitiveness and profitability, the buyer added. Last year, EHII made a loss of CNY1.4 million (USD199,521). Its net assets are worth about CNY600 million.

The Covid-19 pandemic has intensified competition in the display sector. BOE Chairman Chen Yanshun said in a forum in Shanghai on July 22 that demand for panel displays has slowed down so companies are looking to combine their resources with increasing global concentration.

But IoT will bring CNY1 trillion (USD142.6 billion) worth of new opportunities for all, Chen said, adding that fifth-generation wireless networks will spur more demand for linked-up technologies.

BOE's stock price [SHE:000725] fell 1.9 percent to CNY4.70 (US 70 cents) this morning.

Editor: Emmi Laine